Five Tech Trends

Tech Reshaping Meat, Eating and Sustainability

Plant-based “meats,” AI-powered grocery experiences, 3D printed food, ghost kitchens and smarter delivery apps are all reshaping the food industry in diverse ways. As consumer habits shift because of smarter, newer tech innovations — and as tech developments are driven even more by consumer demand — the food tech industry is rapidly reconsidering what it means to access, order, cook and eat food.

In fact, there is no bigger industry on the planet than food and the businesses that surround it — from agriculture and delivery to cooking and consumption. In 2020, more than $17 billion was invested in food technology solutions, according to FoodTech Data Navigator, while food and agriculture start-ups attracted a record $22.3 billion in venture funding last year, twice as much as these segments raised the year before, reports Finistere Venture.

As more capital is being invested in food tech, the consumer technology industry is taking notice. For its part, CES has dedicated even more space to the food tech category since the world’s first robotic kitchen debuted at CES 2021. Created by Moley Robotics in the U.K., the system featured a robot that helps prepare meals at the touch of a button within a luxury kitchen environment.

At CES 2022, food tech is expected to be an even bigger breakthrough category, with spotlights on agriculture, ingredient innovation, meal kits and deliveries, nutrition, plant-based proteins, traceability, sustainability and vertical farming. Technology, says Karen Chupka, EVP, CES, is propelling the food industry “to new heights,” appealing to enthusiasts, professionals, early adopters and mainstream consumers. It’s expected that food technology’s global market share will exceed $342 billion by 2027, notably as the demand increases for access to cheaper, healthier and safer food products.

Where’s the Beef?

Cultured meats are actual animal protein grown from living animal cells in a lab like San Francisco based Eat Just. However, Impossible Foods, an exhibitor at CES 2022 and an international game changer in the plant-based meat category thanks to its Impossible Burger, is accelerating its next-generation product development, including plant-based substitutes for steak, seafood, chicken, milk and eggs. Because cow product production is among the environmentally destructive technologies, says Impossible Foods Founder and CEO Dr. Patrick O. Brown, the Redwood, CA, company is doubling down on its research to advance plant-based food development.

Presently, Impossible Foods is valued at more than $4 billion, with animal-free meat substitutes now widely available at major chains including Burger King and Starbucks. Beyond Meat, a close competitor, raised its first round of venture capital in 2011 and has quintupled in value since an initial public offering last year.

Overall, a record-setting $3.1 billion was invested in alternative proteins in 2020, according to The Good Food Institute, which is more than half of the total $5.9 billion invested in this sector during the last decade, and three times more than in 2019. Polaris Market Research predicts that plant-based meat alternatives will grow annually by almost 16% through 2027.

“Our stated goal since Impossible Foods’ founding has always been to drive down prices through economies of scale, reach price parity and then undercut the price of conventional ground beef from cows,” explains Brown. “Less than a year ago we cut food service prices by 15%.” It’s expected the price cuts will continue for both the burger patties and sausage made from plants, pushing them even further into cultural consciousness with the promise of a premium product at competitive price points.

CES has dedicated even more space to the food tech category since the world’s first robotic kitchen debuted at CES 2021.

The Bigger Picture

Another food technology disrupter is Controlled Environmental Agriculture (CEA), which seeks to streamline feed for cattle while reducing carbon emissions and minimizing waste with less water use. With farmers expected to increase their output by 60% to feed the world’s growing population by 2050, the issues are paramount, says Grov Technologies, a CES 2020 exhibitor that specializes in CEA.

Using a combination of engineering, plant science and computer-aided environmental control technologies, Grov is seeking to optimize plant growth and quality, as well as overall agricultural production efficiency.

“With a growing population, climate change and economic uncertainty, farmers are being asked do more with less and find innovative ways to overcome these challenges,” explains Steve Lindsley, Grov Technologies’ president. Using the research and science-based growing protocols, the company created its largest controlled environmental agricultural, the Olympus Tower Farm, an automated indoor growing system for commercial scale production of fresh animal feed. The bigger goal is to help dairy and beef producers become more sustainable and economically viable in a world facing a climate crisis.

Taking up less than 900 square feet of space, Olympus Tower can produce up to 6000 pounds of sprouted wheat and barley grass per day using less than 5% of water than would normally be used to create the same surplus. Lindsley says the solution replaces up to 50 acres of traditional farming, which is a major consideration as the meat and dairy industries are at a turning point over issues of sustainability. He says, “Increased consumer demand for traceable, local food and the agricultural risks associated with climate change have made it essential for farmers to adopt sustainable technologies.”

The App Revolution

As the food industry itself faces unprecedented challenges in production, demand and regulations, consumer demands have also changed considerably during the pandemic. For example, an increased demand for fresh and fast access to food has put significant pressure on the food industry to innovate, making food delivery apps, like DoorDash, Instacart and UberEats, game changers in the way food gets from restaurants and grocers to customers at the touch of a button.

According to Leah Seay, UberEats spokesperson for communications and delivery, the company has partnered with 700,000 merchants in more than 6000 cities globally, while keeping average delivery times under 30 minutes. “Uber delivers instant access to local commerce,” says Seay. “We help people discover local merchants, order meals, groceries, and more at the touch of a button—and get it delivered reliably and quickly.”

The pandemic lockdown inspired more consumers to use the apps to access food, a convenience that appears to have staying power. Seay expects the service to continue to grow. “By broadening our global ordering and delivery offerings into grocery, convenience, alcohol, specialty goods, pet supplies, flowers and more,” she says, “we’re leveraging the best of Uber to move what matters within hours if not minutes—to the benefit of consumers, local merchants, and of course, earners with increased delivery opportunities.”

Tech-based delivery apps are also looking to new innovations to streamline the experience. San Francisco-based Instacart could potentially enlist robots for in-store shopping, which would replace human gig workers that are becoming increasing harder to come by due to labor shortages. Bloomberg first reported in June of 2021 that the company would ultimately need to build automated fulfillment centers across the country with hundreds of robots transporting boxed and canned food, leaving humans to pick produce and deli items.

In 2020, more than $17 billion was invested in food technology solutions.

-FoodTech Data Navigator

Presently, Instacart uses thousands of gig workers to shop and deliver groceries, with consumers paying upwards of 25% in delivery fees, tips and price hikes per order. The popularity of these services grew during the pandemic, and are expected to keep growing now that they have, in a sense, been mainstreamed.

In its Beyond the Cart: A Year of Essential Insights, Instacart explores how the pandemic changed its business model and the way people shop for food. One of the most revealing finds is that seniors accounted for the largest jump in Instacart users compared to any other age group. To date, nearly 300,000 seniors have learned to use the app with the help of Senior Support Service. And according to a Harris Poll of those who bought groceries online during COVID-19, 77% say they are likely to continue to do so in the future.

Instacart predicts that the future of food access will be defined by a few factors, including:

• Speed and Convenience

When presented with delivery options including two-hours or less delivery, five-hour delivery and other scheduled options throughout the day, 85% of customers opted for delivery within two-hours or less. In 2020, 95% of small orders were delivered in under two hours and 50% were delivered in less than one hour.

• Adds Accessibility

Post-pandemic, the profile of the online grocery delivery customer will continue expanding to both younger and older customers. The use of the technology by seniors has been growing by about 1000 senior customers daily.

• A Personal Touch

Now that customers have spent a year communicating directly with their shoppers, there will likely be a boost in chat functions. Elevated use of phrases and emojis that communicate gratitude suggest customers will retain a deeper sense of appreciation for their personal shoppers.

With demand for food e-commerce growing, thanks to everything from front-door deliveries to meal kits, food tech companies raised about $17.3 billion in 2020. Of this, 68% went directly to the e-commerce and delivery businesses. And meal kits alone raised $6.2 billion, while e-commerce companies raised $5.3 billion.

It’s expected that delivery platforms will dominate the food tech space even more in the coming year, thanks to smarter options for consumers. For example, so-called ghost kitchens are already helping to create delivery-only brands that are gaining in popularity even if they never had a brick-and-mortar presence in the first place. In addition, third-party fulfillment centers that cook and batch for a variety of brands, are expected to increase their market presence, according to Fast Company. These are literally places where food is made to ship out rather than eat in. All of this will be happening while changes continue to shape the playing field, like Uber acquiring Postmates, DoorDash going public and Grubhub being sold.

In fact, a new swath of delivery platforms will also likely be shaped, in part, by evolving consumer behaviors and demands post-pandemic with an increase on customization. GoPuff in the U.S., for example, will deliver convenience items and alcohol in cities in less than 30 minutes, while Instacart and other grocery-only platforms will likely expand to include many more deliverable goods outside of food.

What Consumers Want

Today’s consumers have an abundance of food options at the tap of a smartphone button. But more than ever, tech-savvy users are truly seeking nutritious food that can be accessed easily, with limited waste from companies that align with their personal tastes and ethics. Spending trends suggest that consumers are willing to pay much more for convenience and better quality overall, especially if the food they order is healthy and has a far less negative environmental impact.

A big part on this farm-to-table e-commerce niche are companies that ship ready-to-use meal kits like Hello Fresh, Daily Harvest and Blue Apron, all of which grew in popularity during the pandemic. Designed to eliminate the need to shop for ingredients or to even know how to cook, the kits have become a fast-growing category since the first one was introduced in 2012. According to Statista, at the current trajectory, meal kit revenue is expected to grow to more than $7.6 billion by 2024, an increase from $2.5 billion in 2017.

What makes the kits so appealing is the sheer variety of cuisines being offered, the freshness of ingredients and the ease of use, like being able to put together ingredients to make a restaurant-quality meal at home, even for consumers who may not know their way around a kitchen. There is also the connection people have cooking together, something that exploded in popularity during the pandemic.

By 2022, the meal kit industry is expected to be worth $11 billion in the U.S. alone, skewing younger in terms of consumers. A Money-Blue Consult survey revealed that more than a quarter of Generation X and almost 30% of millennials had used the meal kit service. But when it comes to Baby Boomers and older generations, only about 12% tried the kits.

The biggest demographic for the kits tends to be mostly urban, primarily male consumers that earn six figures. American consumers who use the kits (81%, according to a Harris Poll) say they thought they were ultimately healthier compared to take-out options. The same consumers also seem to prefer meals at home to eating out, with health-consciousness shaping what they order.

Overall, the idea of “big food” is becoming less appealing than “small food,” according to EY, a think tank connected to Ernst & Young Global Limited. Food by design, the idea that nutrition can be customized sustainably and delivered easily, will potentially reform the way people eat, what they eat and how technology impacts the global supply chain and, perhaps even more significantly, human health.

With more personalized, localized eating becoming a major driver of the food tech world, companies will have to consider what role they ultimately play. Consumers will continue to influence how the industry pivots to account for cultural and scientific changes, global and climate challenges and ultimately how we all think about what we eat and how.